Businesses pressed on Sudan ties

As violence continues in Sudan, state and federal lawmakers are pushing legislation that aims to prevent American investment dollars from supporting what many are calling a genocidal regime.

SARAH SHEMKUS

As violence continues in the African nation of Sudan, state and federal lawmakers are pushing legislation that aims to prevent American investment dollars from supporting what many are calling a genocidal regime.

The bills at both levels are designed to require or encourage the withdrawal of investments in companies doing business in Sudan, an approach known as divestment.

On Wednesday, the Massachusetts House passed a bill that requires the state's pension funds to divest from a targeted group of businesses whose involvement in Sudan is thought to be directly or indirectly contributing to the violence.

"It's the right thing to do," said Rep. Cleon Turner, D-Dennis, a co-sponsor of the bill. "It's telling people that we're not going to be silent on those issues anywhere in the world."

The conflict in Sudan began in the Darfur region in 2003 when government forces and allied militias began fighting with armed rebel groups, according to information from the United Nations.

The U.N. estimates that at least 200,000 people have been killed and more than 2 million displaced as the violence has spread.

Murders, rapes and other such crimes have become widespread, and the situation in the country is widely seen as among the biggest humanitarian crises in the world.

The total sum to be divested if the state bill becomes law currently stands at about $54 million, representing investments in eight companies, according to Michael Travaglini, executive director of the Pension Reserves Investment Management Board, the body that oversees the state's pension funds.

The retirement systems of both Barnstable and Dukes counties are members of the fund overseen by the managing board.

The legislation, which was approved by the state Senate in July, has the support of Gov. Deval Patrick, a spokeswoman for the governor confirmed.

Meanwhile, a federal bill, approved by the U.S. House in July, would require the secretary of the Treasury to compile a list of companies whose practices support the genocidal practices of Sudan's current rulers.

The proposed legislation also authorizes state and local pension funds as well as other asset managers to divest from such companies and prohibits federal procurement contracts with any business on the list.

The bill has been referred to the Senate Committee on Banking, Housing and Urban Affairs. No spokesperson from the committee could be reached yesterday to comment on the status of the proposal.

Divestment has the potential to exert a positive influence on Sudan because it puts financial pressure on the government, explained Daniel Millenson, national advocacy director for the Sudan Divestment Task Force, a project run by the Washington, D.C.-based Genocide Intervention network.

"Genocide isn't cheap," said Millenson. "One of the main ways Sudan finances the genocide is through its oil industry."

Foreign oil companies that operate in Sudan generally have revenue-sharing arrangements that channel billions of dollars into government coffers, Millenson said.

Of this money, he said, approximately 70 percent goes toward the country's military.

"And Sudan's military expenditures include killing people in Darfur," he added.

Divestment could convince companies doing business in Sudan to change their practices in ways that would reduce the country's revenue.

"The model has already been very successful in pushing several major companies operating in Sudan to either change their behavior or leave the country entirely," Millenson said.

Not everyone is enthusiastic about divestment, however.

The Pension Reserves Investment Management Board has consistently opposed all divestment legislation, said Travaglini, on the basis that such measures could hurt the fund's investment returns.

"Once you do one divestment bill, the line forms around the block," he said. "Pretty soon we'll have no way to invest."